Poolism: sharing economy vs. pooling economy

As a partner in the upcoming Synergia Summer Institute the P2P Foundation will over the coming month feature a series of interviews, articles and videos by the course’s tutors on key themes that inform the program on “Transition to Co-operative Commonwealth: Pathways to a new political economy”.

Today we feature an interview with Christian Iaione, Associate Professor of public law, Guglielmo Marconi University of Rome; Fellow of the Urban Law Center at Fordham University; Director, LabGov – Laboratory for the Governance of the Commons.

Sharing economy builds on new or revived social patterns having important business, legal and institutional implications: the social practices of sharing and collaboration. They both build on the well known social practice of co-operation.

Given its innovative and dynamic nature, the concept cannot be ultimately defined. It encompasses however phenomena presenting the following features:

(i) its main agent does not act as the standard economic agent, the homo oeconomicus;

(ii) the sharing economy adopts a platform approach whereby relations, reputation, social trust and other non-economic motives within a community become one of the main drivers;

(iv) on a smaller, local scale some sharing economy initiatives might be limited to the common use or management of physical assets (e.g. co-working spaces, urban commons, etc.) or to new forms of peer-to-peer, sometimes street or building level, welfare systems.

Many think that the main actor of sharing economy is no longer the “consumer” willing to own something or buy some service, but rather a citizen, commoner, user, maker, producer, creative, designer, co-worker, digital artisan, urban farmer willing to have access to some service or asset that is needed to satisfy some of her needs. However, others argue though that the sharing economy actor is in many instances also someone willing to act and take care of, manage, generate or regenerate a common, open access resource, material or immaterial, without the intermediation of a public or private provider, on a peer-to-peer, person-to-person small scale level. Thus in the sharing economy the actor is not a mere “economic actor”. It could rather be a social or personal or civic actor for whom traditional economic motives are secondary or entirely absent. Some of the SE realms are not necessarily “economies” in the strict sense, but social communities and networks of collaboration that generate new economic ventures or are functional to existing economic activities.

In any case sharing economy seems to question the homo oeconomicus, a self-interested profit or utility maximizing individual, as its main agent[1] and be able to give rise to a new economic identity. An individual not guided by the perpetual quest to maximize its own material interests, an individual unwilling to act alone[2]. It is an archetype of individual who, while not giving up the pursuit of her passions and interests, understands that her individual freedom is nothing if it is not associated with a commitment to the community, if the “acting alone” is not paired with the “acting in common”[3]. Sharing economy main agent might be thus framed more as a “mulier activa”[4]. An individual able to act in the public – social, economic, political – arena and to place herself in relation to others in order to take care of the general, common interest which is the main of the three pillars of a “vita activa”[5]

A distinction between the various forms of sharing economy is however needed. They all use the same social paradigm, the act of sharing, collaborating, cooperating. Yet they are very different from one another. There is room to spell out those forms of sharing economy that perpetuate in some way the same social and economic dynamics of the pre-existing economic model and apply to each of them a different legal regime. The profit/non-profit divide does help in reading sharing economy initiatives, but it is not sufficient to draw the line between different forms of sharing economy. There are forms of profit/non-profit activities in almost each of the sharing economy realms. Also the profit/non-profit criterion is increasingly questioned even by standard economics as new hybrid forms of business arise.

A first distinction could be drawn between “sharing economy in the strict sense” and collaborative forms of sharing economy by framing collaboration and cooperation as added layers of sharing. As a matter of fact a distinction could be made between sharing economy initiatives that create and ossify a distinction between different typologies of users (consumers-users vs. providers-users) and sharing economy initiatives that foster peer-to-peer approach in which every user could be provider and consumer at the same time or even be involved in the platform governance. Even further cooperation could suggest a commons-based approach to sharing economy[6]. If the actors involved do not just share a resource but collaborate to create, produce, regenerate a common resource for the greater public, the community, they are co-operating, they are pooling for the commons.

Two main realms of sharing economy and four forms of sharing economy seem to emerge:

“sharing economy in the strict sense” composed of:

“access economy”, for sharing economy initiative whose business model implies that goods and services are traded on the basis of access rather than ownership. It refers to renting things temporarily rather than selling them permanently;

“gig economy”, for sharing economy initiatives based on contingent work that is transacted on a digital marketplace;

“pooling economy” composed of:

“collaborative economy”, sharing economy initiatives that foster peer-to-peer approach and/or involve users in the design of the productive process or transform clients into a community;

“commons-based economy”, “open cooperativism”, “open platform cooperativism” [7] for sharing economy initiatives that are collectively owned or managed, democratically governed, do not extract value out of local economies but anchor jobs, respect human dignity and offer new forms of social security.

Finally, the growth of sharing economy should only partially be considered a revolution and/or a consequence of the crisis[8]. For some aspects it might also represent, thanks to information technologies, the reverse-transformation[9] or the transition[10] of some sectors of the current economic model to long-standing economic traditions and economic models’ (e.g. cooperative economy, social economy, solidarity economy, handicraft production, commons economy etc.) and even to ancient forms of economic exchange (e.g. the bartering economy), which are alternative to capital-intensive forms of market economy.

[1] Encyclical Letter Laudato si’ of the Holy Father Francis on care for our common home (24 May 2015). See paragraphs 13, 14, 90, 211. See also L. Trotsky, Attention to small things, (1 October 1921).

[2] For an archetype of individual willing to collaborate or “reciprocate” see for instance the “homo reciprocans” of S. Bowles, H. Gintis, Homo reciprocans, 2002.

[3] A. de Tocqueville, Democracy in America, 1835.

[4] See C. Iaione, Economics and law of the commons, 2011.

[5] H. Arendt, Vita activa, 1964.

[6] D. Bollier, Think like a commoner: a short introduction to the life of the commons, 2014. S. Foster, Collective action and the Urban Commons, 2011; C. Iaione, The Tragedy of Urban Roads, 2009.

[7] J. Schor, Debating the sharing economy, 2014.

[8] K. Polanyi, The great transformation: The political and economic origins of our time, 1944.

[10] See P. Conaty, D. Bollier, Toward an open cooperativism, 2014, available at http://commonstransition.org/toward-an-open-co-operativism/. See also T. Scholz, Platform cooperativism vs. the Sharing Economy, available at https://medium.com/@trebors/platform-cooperativism-vs-the-sharing-economy-2ea737f1b5ad